Edwards assails new overtime regs

WilliamL. Watts

WASHINGTON (CBS.MW) -- New rules governing overtime pay take effect Monday, and a politically charged debate over the impact of the regulations on American workers' paychecks looks likely to extend until Election Day.

Democratic vice presidential candidate John Edwards took aim at the new regulations in Saturday's weekly Democratic radio address.

"Working Americans have to tighten their belts in this economy, and on Monday that belt's about to get a whole lot tighter when this new overtime law starts working," he said. Computer programmers, line cooks, some police officers and others are vulnerable, Edwards said.

Republicans say Democrats are using the new rules to scare voters.

At issue are new Labor Department rules finalized in April that govern eligibility for overtime pay. The Bush administration and business groups say the new rules are a needed update to outmoded and often confusing regulations that haven't been changed in decades, and eliminate a costly source of litigation. A number of firms, including retail giant Wal-Mart
WMT, -0.30%
have faced lawsuits alleging illegal denial of overtime pay.

Opponents, including most Democrats and labor unions, say the rules will deny millions of Americans overtime pay.

The regulations include overtime-pay guarantees for all workers earning $23,660 annually or less, thus covering more workers than the $22,100 salary bar initially proposed by the Bush administration last year. Currently, the Fair Labor Standards Act guarantees overtime for those earning $8,060 or less.

The new rules, slated to take effect in about four months, also exempt from overtime pay all employees earning $100,000 or more, if they meet certain tests, while the earlier rules set that threshold at $65,000.

Opponents say other provisions of the rules will result in as many as 6 million Americans losing their current rights to overtime pay. The Labor Department says around 107,000 Americans could lose their right to overtime pay, but around 1.3 million will gain eligibility.

A report by the Economic Policy Institute, a liberal think tank, estimated that nearly 2 million workers who are "team leaders" will be ineligible for overtime pay under the new rules, along with about 920,000 workers without college degrees who will be reclassified as "learned professionals." See full story.

Among the additional workers who will become ineligible are some who earn more than $100,000 a year, as well as some teachers, computer programmers and supervisors, the report said.

Proponents of the rules say EPI has drastically overestimated the impact of the regulations. Responding to Edwards on Saturday, the Bush-Cheney campaign said the EPI study included part-time workers who are not affected by the regulations.

Most of the workers that EPI argues would lose overtime eligibility currently don't receive overtime because of existing exemptions for executive, administrative and professional workers, according to Kirk Johnson, an analyst with the conservative Heritage Foundation.

Johnson said the EPI report also ignored or discounted new rules that favor employees and will make it more difficult for employers to deny overtime protections.

The Labor Department revised its initial rules proposal after congressional Democrats unsuccessfully tried to block new regulations and called attention to provisions they said could deny overtime eligibility to police officers, firefighters and others.

The final rules, for example, were altered to ensure public safety officers remained eligible for overtime, but some critics contend that senior officials could still be denied overtime pay.

The regulations take hold as the economy remains the top issue on the minds of voters, followed closely by the war in Iraq, according to the latest CBS News poll, released late Thursday, which showed President Bush and John Kerry in a virtual tie.

Forty-six percent of voters said they would vote for the Democratic ticket of Kerry and running mate John Edwards, while 45 percent would support the Republican ticket of Bush and Vice President Dick Cheney. The independent ticket of Ralph Nader and Peter Camejo would receive 1 percent of the vote.

When asked what issue they most wanted the candidates to address, 24 percent of those surveyed said the economy and jobs, while 20 percent identified Iraq. Health care was third at 12 percent, followed by foreign policy/defense at 6 percent. Education and terrorism rounded out the top responses at 5 percent each.

Intraday Data provided by SIX Financial Information and subject to terms of use. Historical and current end-of-day data provided by SIX Financial Information. All quotes are in local exchange time. Real-time last sale data for U.S. stock quotes reflect trades reported through Nasdaq only. Intraday data delayed at least 15 minutes or per exchange requirements.